Which of the Following Would Reduce Short Term Interest Rates

question 18

Multiple Choice

Which of the following would reduce short term interest rates?

• A) the issuance of new government bonds by the central bank
• B) a sale of bonds by the central bank
• C) an increase in discount window lending
• D) an increase in reserve requirements
• E) a tighter credit policy by banks

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Definitions:

Confidence Interval

A range of values, derived from sample statistics, that is likely to contain the value of an unknown population parameter, with a given level of confidence.

Ethanol

A volatile, flammable, colorless liquid commonly used as a fuel and in chemical synthesis, and also found in alcoholic beverages.

Disinfectant

A chemical agent used to eliminate or significantly reduce the presence of pathogenic microorganisms on surfaces or objects.

Bacterial Contamination

Bacterial contamination refers to the undesirable presence of bacteria in a substance, environment, or object, which can pose health risks.